IT and pharma sectors look tactical buy in short- to medium-term peak

This week, the domestic market reached the psychological milestone of 25,000, with a peak at 25,078.30 before closing at 24,717. The market experienced a brief surge, in the last 7days, before consolidating due to subdued quarterly results & clampdown in Asian market like Japan. Initially, the week started positively as the budget-related volatility eased, but the rally lost momentum as the muted earnings reports emerged. These underwhelming results do not justify the substantial premium valuation India holds today. MSCI India one-year forward P/E is at 24x and MSCIEM is at 12x, 100% premium. India’s advantage lies on the ability to decouple from other emerging markets, that earnings growth is slowing in Q1.